The IBM Power Systems platform provides a growing Zappos.com with the performance and scalability to deliver outstanding customer service.

Zappos.com is an online commerce success story and the leading Web shoe retailer in the United States.

The company is now expanding its offerings to include accessories, clothing, luggage, eyewear, jewelry, housewares and electronics. Started in San Francisco in 1999, the company made almost no money that year but had gross merchandise sales of US$1.6 million the second year, an indication of the growth that was to come. A commitment to providing an unprecedented level of customer service that includes free shipping both ways and a 365-day return policy has put Zappos.com on track to have US$1 billion in gross merchandise sales during 2008.


Combining fun with customer service


At its corporate headquarters in Henderson, Nevada, the lively culture of Zappos.com thrives. Buyers, marketers and call center operators work side by side in a fun atmosphere. Shoe and clothing samples line the hallways so that questions can be answered to assist with customer decisions. Another core value, "Create Fun and a Little Weirdness," is evident in the colorfully personalized workspaces and conference rooms and parades as well as a corporate policy to treat every visitor as royalty. The Zappos.com culture is also embraced by the 24x7 team members at the fulfillment center in Shepherdsville, Kentucky, who ensure that each order goes out the door as soon as possible. A permanent Karaoke stage is ready for action just outside the cafeteria, and a contest is running to select the superheroes whose images will be boldly painted throughout the facility.


Improving customer service with automation


At the nearly one-million-square-foot facility in Shepherdsville, thousands of feet of conveyor belts speed incoming and outgoing shipments. Craig Adkins, vice president of services and operations, says, "We have, in my belief, unprecedented commitment to our customers, but we also do a few things that are different, largely on our inventory end. Every single item in our warehouse is individualized, serialized, and even if two things are exactly the same, we can track each item individually. So it makes for a lot of transactions in our system."
At Zappos.com, a customer order can be loaded onto a truck an astonishing 48 minutes after a customer places an order and be bound for UPS Worldport, the delivery service's worldwide air hub in Louisville, Kentucky. Anthony Vicars, director of fulfillment at Zappos.com, says, "Around 75 percent of our orders on any given day are repeat customers, and that's because they feel at ease ordering through us."
The newest innovation at the facility is the implementation of robotic delivery systems for a portion of the nearly five-million-piece inventory. Adopted and named by Kentucky team members, these robots take goods to be shipped directly to packing stations. "Pickers" who once walked 12 to 13 miles a day with barcode scanners in hand now stay in one area as robots deliver shelving units to them. Adkins notes that including robotics in the fulfillment process is expected to reduce the time from "click to truck"
to less than 10 minutes.


Open source gets Zappos.com off to a good start


Zappos.com's early years were spent in a small house in San Francisco above
a restaurant. The entire IT operation consisted of several off-the-shelf "white boxes." With little money to spare in the beginning, the in-house development of open source applications was the perfect solution for the growing company. Systems manager Kris Ongbongan says, "We couldn't afford to buy software back then. And there was no "shoe store in a box" application to run a Web site. Open source was free, so we built our own systems." According to Jon Jacobs, manager of the development team, Zappos.com applications are developed using Linux, Apache, MySQL and Perl technology, known as a LAMP stack. IBM WebSphere MQ software is used for messaging between applications and Web services.


Addressing the challenges of growth with innovation



As the company began to grow, it became increasingly challenged with maintaining around-the-clock availability and providing a speedy customer experience. So Zappos.com turned to IBM Premier Business Partner Sycomp and was introduced to IBM POWER5 technology in 2005. Mike Symons, CEO of Sycomp, says, "Zappos's growth rate was phenomenal, and database transaction rates were continuing to accelerate. They needed a solution that would provide them with the horsepower to scale and keep up with the growth rate that
they were experiencing. IBM Power Systems offered the performance and efficiency they were looking for in a database server with the Power 570." The unique building block features of the IBM Power 570 system enabled Zappos.com to pay for the additional processing capacity it needed to stay ahead of demand. And because the additional building blocks were added to the original rack, the system footprint has remained unchanged since the day it was installed.


Big steps, small footprint


The Zappos.com infrastructure is all "Blue," with servers and storage from IBM. All of the approximately 30,000 orders placed each day through www.zappos.com and its sister site, www.6pm.com, go through the IBM Power 570 system. The company's technology infrastructure also includes two IBM BladeCenter H Chasses that enable quick scaling of Web servers, along with IBM System Storage N5500 Gateway and IBM System Storage DS8300 devices.
Ongbongan says, "We have a very small footprint for the amount of business we do. One of our core values is, "Do More With Less," and having Power Systems helps us do more with less. Every transaction still goes through that server we bought years ago."
So, what's next? Zappos.com is preparing to take advantage of IBM PowerVM virtualization technology using IBM POWER6 platform based systems for application testing and development in its disaster recovery site. "With Live Partition Mobility, we
can do maintenance on the servers without taking the service down," says Ongbongan. "We're very excited about these new capabilities."